Subject:Operations ManagementPrice: Bought3
Lion Co. Ltd was founded in 1974 in Vietnam as a manufacturer of electrical components for computers. With strong research and development efforts, by 2011, it had accumulated more than 25,000 patents granted worldwide. Lion is now one of the world's 500 biggest companies, according to Fortune magazine. Its biggest production operation is located in Da Nang Science & Technology Park, which covers more than 3 square km with 15 factories. Not only does Lion have dormitories, a hospital, and a fire brigade, but it also broadcasts its own TV channel with the park. Lion is highly specialized in producing computer components and produces and packages components for various famous brand names, including Sigma, Huawei, Lenovo, and Sony. The components manufactured are basically identical but are labeled and packaged differently for the various customers. The components have fairly high value-to-weight ratio. The Da Nang manufacturing facility replenishes a distribution center (DC) in Vietnam where the lead time is nine weeks. Lion adopts a continuous review policy to manage the inventory at its DC and wants to maintain a cycle service level of 95 percent for all orders. The previous month had been challenging: Huawei asked for 5,000 extra units than were available at the DC, whereas Sigma and Lenovo ordered 3,500 units and 4,000 units fewer, respectively. Although there was sufficient inventory available at the DC in the form of basic products, Lion was not able to meet Huawei's demand because the excess inventory available was labeled and packaged for Sigma and Lenovo. As a result, Lion lost the extra business opportunity and surplus inventory because of the wrong labels and packaging. A) Which logistics strategiesstrategy areis most suitable for Lion to resolve its issues? Justify your selection. B) Describe how your selected strategiesstrategy could be applied by the company to attain its targets?